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Few companies have a thorough understanding of this relationship and fewer still use that understanding to drive a core set of company values into the actions of company employees. Define a reasonable value proposition that is compelling for the customers 2. Develop congruent company values and make them fundamental to the dayto-day activities of the company and its employees.

A value proposition: — — — — — — Generates mutually shared self-understanding Helps generating common sense actions and problem solutions Builds the foundation of internal and external communication Enhances employee identification with the company Positions the company away from competitors Provides powerful arguments for attracting customers, smart employees, reliable suppliers, trustworthy business partners, and wealthy investors — Helps to make quality management truly effective — Fosters creating a strong brand, providing important opportunities for staying in business and growing 3.

Kinne Fig. Source: Kinne 4 Value Balance — The Organization Side Human, organization and management value capital influences and supports a value structure that is compelling for the customers, motivating for employees, and lays a foundation for building stable customer relationships.

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First is job-specific knowledge and second is contextual knowledge used to tailor the job-specific knowledge to the environment and context of the job. Companies that develop these three elements in their people are more likely to enable staff to perform their job and deliver value to customers. In general, the better the people the better the customer outcome will be.

If the organization does not support the people with an appropriate environment superior performance cannot be achieved. This framework Kaplan and Norton, , p.

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Faerber — Culture: Awareness and internalization of the mission, vision and core values needed to execute strategic initiatives. Motivation is the energy and willingness to use that energy to accomplish tasks in the company. Motivation depends heavily on the skills and attitude of management and the values of the culture that management builds. In the management literature e. However, most core value systems contain the following elements: — Trust: Some management theories Sprenger, are exclusively designed around trust and set trust in the middle of all management decisions.

Trust allows managers to implement fewer methods of controlling employee behavior. Trust does not imply blind trust. Trust reduces fear and its inherent de-motivation within an organization. People are treated with politeness and as human beings.


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Defamation and discrimination are not acceptable. Openness implies that transparency in communication between management, colleagues and employees is required. An Exploratory Application 19 — Integrity: Especially for managers integrity is the most important value. Integrity requires that the personal behavior is consistent with the communicated values, standards and beliefs.

By building a company culture, management is the key factor for success Schmitz, , p. Within an organization, values will only be lived, if the management shows by example that they fully support these values. Defensive marketing is an building block of an idea that evolved into the concept of relationship marketing. Relationship marketing was also influenced by reengineering. According to reengineering theory, organizations should be structured to complete tasks and processes rather than functions.

That is, cross-functional teams should be responsible for a whole process, from beginning to end, rather than having the work go from one functional department to another. Traditional marketing is said to use the functional department approach e. Kotler et al. Pricing, product management, promotion, and place are often functional silos that must be coordinated and integrated by the marketer if she is going to achieve marketing success.

According to Gordon , the marketing mix concept is too limited to provide a usable framework for assessing and developing customer relationships in many industries and should be replaced by an alternative model where the focus is on customers and relationships rather than marketing functions. Value-balance implementation is a direct application of this principle.

Relationship marketing is cross-functional marketing organized around processes that involve the entire organization. In spite of this broad view, relationship marketing retains its core marketing orientation. It involves the application of the marketing philosophy to all parts of the organization. The way Regis McKenna , pp. Faerber Because of this, he claims that relationship marketing is a more pure form of marketing than traditional marketing. Relationship marketing relies upon the communication and delivery of consumer requirements to existing customers in a mutually beneficial exchange Gale and Chapman, The capability of a company to deliver value to the customer drives company sales.

Accuracy of communication and overall relevance to the customer remains the key factor of success in relationship marketing. The key to relationship marketing success is customer retention, and the ability of a company to drive that retention depends on the achievement of value balance. Successful customer retention efforts involve several considerations including the following: — Customer value to the company — Gordon describes how to value customers and categorize them according to their financial and strategic value so that companies can decide where to invest for deeper relationships and which relationships need to be served differently or even terminated.

This is simply the percentage An Exploratory Application 21 of customers at the beginning of the year who are still customers at the end of the year.

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Achieving this coordination requires cross-functional cooperation, which can be enhanced by the use of cross-functional teams. All of these activities are part of the implementation of a value-balance initiative.

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F Snaps is a medium-sized company founded in as a supplier of snaps for the premium clothing market. By the workforce had grown to , with sales of million snaps per year. Products include buttons, buckles, rivets, snaps, and labels. The company sells primarily to the apparel industry in Europe. The key value driver for the business is the maintenance of good relationships with customers.

The company is located in Bassano del Grappa, Italy. AMF, Fig. First, we defined the values currently held by the employees and management of the company using in-depth personal interviews during the first workshop with done in Bassano — Italy together with Mr.

Peter Kinne in Second, we assessed similar information from 22 C. Source: AMF customers. Third, we derived the current value proposition. Fourth a plan was developed to drive congruence between the value proposition and employee behavior norms. Follow-up control studies and program adjustments are planned to test the effectiveness of the implementation of the value-balance program from both the company and customer viewpoints, but these studies have not been complete when this paper was written.

Figure 3 outlines this approach. The objectives for the stages of the process are developed on the right side of the figure. Source: Kinne 6. As Fig. The following implementation process was used to build this cascade system within the A. The interviews were structured to allow 24 C. Faerber participants to describe the corporate value structure using their own value positive and negative constructs and their own structure for defining those values. The responses were analysed using a simple content analysis process that was designed to identify commonalities between the responses of the participants.

The values and descriptions of the respondents fell into three primary groups including performance and features of products and customer service; special or core company competencies; and the internal values lived by the company. Similar responses were counted and the frequency of responses were used to create the company profile.

A simple categorization process was used. Attributes mentioned less often helped to define the identity of the company, but they were held to be less critical in helping to understand customer perceptions of the company.

The outcome of internal values is: — — — — — — Good cooperation Good work environment Self responsibility Open minded Employee oriented Respectfulness 7. In that way we will create a balanced value profile that will be the basis of the future company strategy, for internal and external communication and a value based quality management program. Why does A. F belong to your suppliers?

Read e-book Retention Management. Ansätze, Instrumente, Erfolgsfaktoren (German Edition)

How are they different? Are there attributes that are significantly well developed? Faerber Table 1 Frequency of unprompted mentions of value attributes of suppliers Value attributes unprompted Frequency Attributes of A. Reliable delivery Price-performance-relationship Product quality Smooth communications Quick understanding Countable prices Keeping promises Innovative design Fast delivery Creativity Honesty Technical support Date confirmation Problem solving Meet technical demand Variety of collections Ethical values 4 4 2 2 2 2 2 1 1 1 1 1 1 1 1 1 1 Mrs.

Staff Person Collaborative relationship Product quality Creativity Fast sampling In-house support Innovation power Quick response-time Future orientation Design of metal trimmings Rich ideas Products more interesting Flexibility Competence in development Frequency 3 2 1 1 1 1 1 1 1 1 1 1 1 1 Two executives at each of three customer organizations were also interviewed for this part of the study. The interview is based on a structured questionnaire, consisting of two parts.

In part one, the customer was asked for an unprompted list of attributes that are important in selecting a supplier. Then each respondent was asked the reason why the customer does business with A. Key: The length of the bars indicate the extent to which A.

Bars to the left show poor rated performance relative to the importance of the attribute to the customer. Pleasant relationship is the opposite, good performance on a less important attribute.